Small and Medium Enterprises

Introduction

Micro, small and medium-sized enterprises (MSMEs) are the economic engines of the APEC region and of all APEC economies. MSMEs account for over 97 percent of all businesses, most private-sector employment and about half of private sector output within the region. MSME development can support growth in the APEC region and ensure that growth is sustainable and inclusive. MSMEs play a critical role in the development of new technologies including artificial intelligence and those that will support the digital and green transformations while many will also face challenges in adopting such technologies. MSMEs play an important link in growing trade and inter-connectedness within the APEC region through increasing participation of MSMEs in trade from their current share of 35 percent or less of direct exports and through enhancing their connectedness to global value chains.

History and Objective

Within the context of the Asia-Pacific Economic Cooperation Forum, SMEs have been recognized as a priority area since the 1993 APEC Leaders’ meeting in Seattle. First established in February 1995 as Ad Hoc Policy Level Group on SMEs, the group was renamed Small and Medium Enterprises Working Group (SMEWG) in 2000. The SMEWG primarily works to encourage the development of SMEs and to build their capacity to engage in international trade.

Vision Statement

The SME Working Group is the champion within APEC for the inclusive development of innovative, sustainable, and digitally empowered MSMEs that are well-equipped to meet the challenges of the 21st century.

Mission Statement

The SMEWG will further promote the development of an enabling environment, foster capacity building, and enhance the inter-connectedness of MSMEs within the APEC region through the sharing of best practices among APEC economies and building on synergies with other APEC fora, the private sector and other stakeholders to promote the development and growth of MSMEs in the Asia-Pacific region.

Ministerial and Plenary Meetings

The APEC SME Ministerial Meetings, held annually since 1994, set out the direction for the working group. The SMEWG held two plenary gatherings per year.

SMEWG Strategic Plan

In September  2024, SME Ministers noted the endorsement of the SMEWG Strategic Plan for 2025–2028, which provided a roadmap to address critical issues pertaining to the growth of SMEs and microenterprises in the APEC region.

These priorities are the following:

• Start-up, entrepreneurship and business environment;
• Scale-up, innovation and growth, including through access to finance;
• Access to international markets and connecting to global value chains;
• Digitalization; and,
• Bio-circular-green transformation. 

 The SMEWG Strategic Plan 2025-2028 has taken into consideration in its development, not only the current challenges MSMEs must face, but also the forward-looking challenges as well as declarations and statements issued by APEC Leaders, APEC Ministers and APEC SME Ministers. The SMEWG, through its Strategic Plan 2025-2028, will make important contributions to the realization of the APEC Putrajaya Vision 2040 and the Aotearoa Plan of Action as well as the Bangkok Goals among others.

SMEWG Terms of Reference

The SMEWG Terms of Reference for 2021–2024 gives the guiding principles on how the group operates in areas such as structure, leadership, meeting arrangements, fora review, quorum, sunset clause; list of tentative chair/vice chair and host of SMEWG meetings till 2040. Access the TOR here.

Last page update: October 2024

Contacts

Current Activities

The 30^th APEC SME Ministerial Meeting was held in Pucallpa, Peru on 13 September 2024. Member economies issued the Pucallpa Statement stressing that, while MSMEs play a crucial role in economic growth, they face challenges that require specific efforts to unlock their full potential. In this sense, it was highlighted that MSMEs need to develop growth pathways that expand opportunities, including access to global value chains, digital tools, technologies, and innovation with a particular emphasis on those led by individuals with untapped economic potential. This includes supporting MSMEs in transitioning from the informal to the formal economy, facilitating access to financing, supporting start-ups, providing training on best practices, leveraging industrial clusters, promoting digital transformation, facilitating data flow, enhancing research, development and technological innovation, and promoting multi-stakeholder cooperation.

During the 58^th SMEWG meeting held in Pucallpa, Peru on 11 - 12 September 2024, member economies:

• Updated on their respective projects and initiatives, as well as best practices, policy measures and achievements, guided by the five priority areas as outlined in the SME Working Group Strategic Plan 2021-2024. These updates reflected alignment with APEC 2024 priorities, APV and APA, among others.
• Received presentation by the APEC Policy Support Unit on the results of the study "Enhancing MSME Data Interoperability in the APEC Region," which was approved for publication by the SMEWG. The report recommended the next steps for MSME data interoperability in APEC. These phases include data preparation, implementation and utilization.
• Were informed by the SMEWG program director that during 2024, 20 projects focused on the abovementioned Strategic Plan priorities as follows, namely: Entrepreneurship, innovation, and start-ups (75 percent); SME access to international markets and global value chains (80 percent); Inclusive capability development towards digitalization (20 percent); access to finance and alternative financial solutions (25 percent); and government to business interactions (20 percent). The last section of the report included specifics on how the Strategic Plan performed during the previous four years for each of the following priorities: first, 85 percent; second, 77 percent; third, 50 percent; fourth, 28 percent; and fifth, 45 percent.

The 31^st APEC SME Ministerial Meeting will take place in the Republic of Korea (date and city to be announced), and the 59^th SMEWG meetings will be held on 22-23 May in Hachioji City, Tokyo, Japan.

The list of SMEWG projects, in implementation or completed, APEC funded or self-funded, can be found here.